Concerned over the country's failure to make a breakthrough in arms exports, a Parliamentary Committee has recommended that ordnance factories should manufacture North Atlantic Treaty Organisation-compatible weapons.

Noting that failure to manufacture weapons upto NATO standards, especially small calibre items, has badly hit the country's efforts to boost arms sales, the Parliamentary Standing Committee on Defence, said specification of indigenous arms should be changed to make them NATO compatible.

Expressing concern that arms exports plunged to mere Rs 41 crores in 2004-05 against Rs 93 crores in 2003-04, thecommittee, in its report, tabled in Parliament, said India should become a major player by offering indigenous missiles,helicopters and major weapons systems for sale abroad.

The committee noted that Indian export market was at present confined to neighbouring nations like Nepal, Myanmarand Maldives, besides catering to the replenishment market.

The committee said the Government should create an Export Promotion Board for ordnance factories. The factoriesshould be restructured and experts involved in them to launch a modernisation drive, it added.

"The Export Promotion Board should have experts from international trade and marketing fields who can evolve aneffective strategy and drive to tap the vast export markets for armaments, ammunitions and other defence products," thecommittee said.

In presentations to the committee, the defence production departments said while an Indian 5.56 assault rifle was being offered at $ 450 per piece, the rate in the international market was between $ 800 and $ 1000.

As part of efforts to boost exports, the Defence Ministry has also sought pruning the negative list of nations and relaxation of licence restrictions from the Originalex - Soviet suppliers.

The Government informed the committee that higher end products and services were being targeted, apart from ensuring procedural simplification to promote exports.

The Ministry has profiled 30 mm Medak Naval gun and upgraded 40 mm L-70 anti-aircraft guns as potential weapons in the export category. The parachute market is also being explored as the Indian product is priced much less in theinternational market.

The Defence Ministry informed the committee that it has sought a nod for developing port infrastructure to handlehazardous cargo as foreign vessels were charging highly for such exports.